THE IMPACT OF FORMAL VERSUS INFORMAL REWARDS IN A MILITARY ORGANIZATION
THE IMPACT OF FORMAL VERSUS INFORMAL REWARDS IN A MILITARY ORGANIZATION

Summary/Abstract: During our life time, we experience situations in which we must motivate or be motivated, to overcome the challenges. We learn what tools to use and how to do it, by observing what our parents or elders do, or by the education we receive. Most organizations have formal motivating systems, which consist of formal rewards and guidance, when and how these tools should be used, by whom and towards whom. Leaders’ personal know-how reveals that besides the formal rewards, there are informal rewards that might be used to motivate employees, which augment the formal rewarding system. These informal rewards are derived from the structural improvement of the organization, are adapted in accordance with the managerial conduct and act as an interface between employees’ queries and their supervisors’ good will. Nevertheless, they are mostly used for situations which are not covered by the formal rewarding system or, when an informal reward might better fulfill employees’ needs. The aim of this paper is to understand if the use of informal rewards influences the use of the formal ones within a military organization, using the cluster method of the Analytic Hierarchy Process (AHP).

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